Brian Winter: Brazil will settle for more of the same from new president

Things may never get much better than they are right now for Brazil or its new president-elect, Dilma Rousseff.

The former guerrilla leader coasted to an easy victory in Sunday's election thanks to broad voter satisfaction with an economy booming at an annual pace of more than 7 per cent.

Yet even she has cautioned that such growth can't last. Instead, her four-year term seems destined to be characterised by a more moderate expansion that will fulfil her goal of lifting millions more Brazilians out of poverty

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Rousseff and her advisers have said they simply don't see the need for wholesale changes to an economy that has many things working in its favour - soaring consumer confidence, record low levels of unemployment, favourable demographics and an impending rush of oil money from new offshore fields.

That conservative approach - which one top aide described as "automatic pilot" - is partly a recognition that Rousseff will lack the political clout of her predecessor, Luiz Inacio Lula da Silva, whose own success was built more on maintaining economic policies than changing them.

Yet she also risks her government being defined by the phrase: "Not as good as Lula."

"We have come to expect prosperity in Brazil now, but people have forgotten that it is not always easy to make the economy grow," said Jose Gomes, who owns a small factory outside Sao Paulo that produces metal plates.

"If growth slows, people won't understand why (Rousseff] can't make it go faster like Lula did," he added.

During Lula's eight years in power, Brazil has averaged roughly 4 per cent growth, with a financial crisis during his first year in office and the global meltdown of 2008-9 outweighed by several years of rapid expansion.

However, that was with several tail winds working in Brazil's favour, including soaring prices for its main commodities, a generally benign global backdrop, and pent-up demand following two decades of economic stagnation.

Rousseff has ruled out a major fiscal reform, saying it is unnecessary with the economy growing and public accounts in what she sees as good shape. She has also refused to modify some of the world's most restrictive labour laws, which would risk alienating trade unions, one of her key constituencies.

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Instead, early signs are that Rousseff will press ahead with the same strategy that got her this far - a continuation of Lula's policies, for better and for worse.

"I recognise that we will have a tough task in taking our economic development to the next level," she said on Sunday, crediting "the genius of President Lula," followed by local entrepreneurs, as the roots of "our new era of prosperity".